Opportunity to meet Renewable Purchase Obligations (RPO) through RECs

[IEX India]

Opportunity to meet Renewable Purchase Obligations (RPO) through RECs

Dear Sir/ Madam, 

Subject: Opportunity to meet Renewable Purchase Obligations (RPO) through RECs 

We extend warm greetings on behalf of the Indian Energy Exchange (IEX). IEX is India's premier energy marketplace which provides a nationwide automated trading platform for the physical delivery of electricity, renewable energy, and certificates (RECs and ESCerts). IEX has a robust ecosystem of 7,500+ participants across 28 States and 8 Union Territories comprising 60+ distribution utilities, 600+ conventional generators, 1800+ RE generators, and obligated entities.

We wish to draw your attention to the Renewable Purchase Obligations (RPO) mandated by the Hon’ble State Electricity Regulatory Commissions, under relevant sections of the Electricity Act, 2003, which aims to promote generation through Renewable Energy Sources.

Since you are an obligated entity who is mandated to purchase a defined minimum percentage of their total consumption of electricity from Renewable Energy Sources. We anticipate that RPO adherence is likely to be significantly increased going forward based on the latest draft of Energy Conservation Act issued by the Ministry of Power.

We would like to inform you that the present market conditions present a favourable opportunity to comply with RPO by participating in REC trading sessions on IEX which now take place twice a month.

• Recent transformation in the REC market, with the CERC Order dated 8th Oct 2023, has abolished the categorization of RECs based on renewable energy sources (solar and non-solar). This simplification allows obligated entities to fulfil their RPO obligations using a single REC. The order further states that the Forum of Regulators (FOR) has unanimously agreed to allow the fungibility of RECs to fulfil any RPO specified by the State ERC.

• The last three trade sessions (15 Nov’23, 29 Nov’23, and 13th Dec’23) have seen clearing prices less than Rs 400/ REC, i.e. 0.4/ kWh, (Rs 375/REC, Rs 375/REC, and Rs 370/REC respectively), which is 60% lower than the earlier floor price of Rs 1000/REC. It is important to note that effective from December 5, 2022, the Hon'ble Central Electricity Regulatory Commission (CERC) through its REC regulations 2022 have eliminated capped prices, floor, and forbearance, and has allowed market-driven price discovery.

Considering the above, we request that the RPO compliance (for FY 2023-24 and previous years) may be critically considered. Please feel free to contact us for any information or assistance required in this regard. Details of contact persons are as follows:

S.No	Name	Email Id	Mobile Number
1	Vindyanchal Kumar	vindyanc...@iexindia.com	7503695472

We look forward to your participation in REC market to meet your RPO obligations.

Message sent by Indian Energy Exchange at 9th Floor Max Tower Sector 16 B Noida - 201301, Noida, Uttar Pradesh, India.

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